GameStop profits nearly triple

By Tom Magrino, GameSpotPosted Aug 21, 2008 10:39 am PT

World's largest specialty retailer reports record Q2 earnings on $1.8 billion in sales for the three-month period.

It's becoming difficult to remember the last time that GameStop wasn't besting its year-over-year quarterly earnings. The largest specialty game retailer in the world announced today that it had continued its trend of record-setting financials into its second fiscal quarter, seeing revenues rise sharply and profits nearly triple.

For the period ended August 2, GameStop raked in $1.8 billion in sales, a 35 percent year-over-year increase. If that number sounds familiar, that's because GameStop also pulled in $1.8 billion during its first fiscal quarter. GameStop's net profit soared an astounding 161 percent from the same period a year ago, rising from $21.8 million in Q2 2007 to $57.2 million for the current reporting period.

Noting that current-generation software sales rose 43 percent for the quarter, the specialty retailer laid out its top-five best-sellers. Take-Two and Rockstar Games' Grand Theft Auto IV was on store shelves for only five days before GameStop's Q1 ended, yet it still managed to land the top slot for the retailer's reporting period. Despite falling out of NPD's top 10 list by June, the highly acclaimed action adventure still managed to secure the top slot of GameStop's charts in Q2. Following GTAIV in descending order were Konami's PlayStation 3-exclusive Metal Gear Solid 4, EA's NCAA Football 09, Nintendo's Wii Fit, and EA's Battlefield: Bad Company.

Thanks to its better-than-expected results, GameStop also revised its full-year earnings guidance upward. The specialty retailer now projects total year-end sales to increase 23 to 25 percent. Earnings-per-share projections are now anticipated to grow by 36 to 39 percent from a year prior to between $2.45 and $2.50.

160 Comments

  • Frost259

    Posted Oct 1, 2008 2:58 pm PT

    Games cost more now because it cost more for devlopers to make them, the reason profits are soaring is that the gameing market is sky rocketing gameing is huge right now, games get more hype than hollywood movies and more and more people are starting to play.

  • SDMF_TrueBlue

    Posted Oct 1, 2008 1:32 pm PT

    So if GameStop is making so much profit, why are new titles for the 360 and PS3 $60? Games cost us consumers more than the previous generation of consoles, but profits for retailers soar. Coincidence? I don't think so...

  • dalejrgamer

    Posted Sep 4, 2008 10:41 am PT

    This proves that GameStop's sponsorship on Joey Logano's Joe Gibbs Toyota in the Nationwide Series truly paid off.

    Then again, there's like three GameStops within the town of Garden Grove and Anaheim.

  • 555fabulous21

    Posted Aug 27, 2008 5:46 pm PT

    That goes to show you, people pay more at gamestop then other game stores.

  • bifordus

    Posted Aug 25, 2008 7:41 pm PT

    Where I live, there are 3 gamestops less than 1/4 mile apart. 2 of them happen to be in the same mall. Its a little worse than Starbucks...

  • toyota23

    Posted Aug 25, 2008 3:45 am PT

    WOW they are like starbucks!

  • subrosian

    Posted Aug 25, 2008 12:40 am PT

    @covenus

    That question is asked in a way that sounds like an accountant trying to talk to a kid on a street corner about itemizing his taxes.

    If you're in Best Buy corporate and you're serious about improving BB's gaming, give me a PM

    -
    GameStop is an interesting beast to address.

  • gho5ty

    Posted Aug 24, 2008 11:10 pm PT

    gamestop should change there name too rip off

  • drumbreak1

    Posted Aug 24, 2008 7:08 pm PT

    ahahahahaha 25 cents that a damn joke lol

  • jaredodd

    Posted Aug 24, 2008 5:43 pm PT

    Yeah that's easy when you rip people off on trade ins. They were trying to give me 25 cents for Perfect Dark Zero and it was in perfect condition.

  • Losarii

    Posted Aug 24, 2008 2:31 pm PT

    Well yeah, when you sell memory sticks and accessories at almost 3 times the price you're bound to get 3 times the profit.

    I was going to purchase a PSP memory stick and it was $40 more than what they sell that same memory stick for at Bestbuy.

    You also tend to get huge profits when you buy used games for half the price and sell them for 5 dollars less than full price.

  • norman_bell

    Posted Aug 24, 2008 11:07 am PT

    I work for EB games and the idea of being able to buy games before they are out is sweet I am a proud owner of GTA 4 and the more they sell the better chance of them making a GTA5 maybe not but I like the idea

  • Akivaria

    Posted Aug 24, 2008 10:24 am PT

    I'm not a big fan of gamestop, but I like being able to pay incrementally for upcoming games. The one near my home has good service.

    Overall though, I'd say go to an electronics store. You'll almost certainly get a better deal.

  • world69star69

    Posted Aug 23, 2008 10:32 am PT

    What do you mean eliminate pc game sales, I go into gamestop all the time..there are two of them in my town, less then 1000 feet from each other, separated by a road(two shopping centers). Each one has pc games there are three sections directly in front of the cash register in one store, and in front of the xbox stuff in the other. They keep putting new pc games in those stores. So I don't know what you are talking about.

  • andrius45

    Posted Aug 23, 2008 5:47 am PT

    okay gamestop came out around the time when i was in high school which was around 2000(maybe earlier , this was the first time i went to a gamestop but i think i remember one somewhere around 199 i did'nt even know there was a place called gamestop or eb games (how it was named back then). but what was great was the pre order, you see i did'nt have a job back then and getting one was difficult(plus i was 14). anywho with gamestop i could make a reservation and try to pay it off little by little it's like having an early credit card except there's no bastard trying to charge me evrymonth for interest charge. so for people who don't have a job or who are in high school and can come up with 5 dollars every now and then. the blow of buying a video game feels a lot less brutal, that's how i did it back then and that's how i'm doing it until i die.

  • xyboink

    Posted Aug 23, 2008 3:43 am PT

    i can't understand why gamestop eliminate the PC game sales. If they don't do that, the sales will be clearer. It means that the figures is not exactly in this news. but if you see the figures; it seems that TakeTwo are in good papers. They won't go bankruptcy and their future is also certain with new (maybe good sales) games such as Metal gear Solid 4, BattleField: Bad Company. I think that the games of the publisher TakeTwo are the best ranked game than these from EA !

  • lokar82

    Posted Aug 22, 2008 4:09 pm PT

    I have to agree with everyone who says if you don't like it, don't go there. I hate Gamestop ever since they decided to eliminate PC game sales, endlessly promote used games over new and stop selling new games that weren't pre-ordered. And so I don't go there. To all that hate them like me, do the following: Trade your games in to a local games shop or sell them on Ebay/half.com if your town doesn't have a local games shop. You don't need to pre-order games at all since I always see plenty of copies of any new release at Best Buy/CC/Target or you could buy from amazon. Gamestop would die if everyone could do these easy steps.

  • gebs99

    Posted Aug 22, 2008 1:21 pm PT

    Im from El Salvador (Central America for those who dont know)i was in miami 2weeks a go and i went to gamestop and bought some games and traded others. Perhaps YOU feel its a rip off but in my country the best you get for a game in GOOD condition is between 15 to 20$ and thats if youre good at negotiating. I didnt feel ripped off but i dont know other stores that buy your used games and how much they give you for them im just comparing to the stores in my country.

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